Can you expand upon/clarify what you mean by "health amount of money in our reserves", especially in the context of receiving less than $200 in investment income each year? Is a "healthy amount" $100,000? $500,000? Over a million? How are these reserves held? Are there any plans in the works to set aside some of those reserves for investment purposes to generate passive income? If no, why not? If yes, what does that timeline look like?
That's a great question! Internally, we are looking to get an investment policy in place and an investment portfolio set up by the end of next year in order to generate additional income. It's been a long-term goal of the Finance Committee to get this in place, and will be our top priority in the coming year. We're still working out the details of what exactly that will entail right now.
To be honest I find this to be rather late to the game in terms of "looking to get an investment policy in place", etc. I know for a fact y'all have been advertising to get a financial advisor volunteer for the last few years, but even without that your commercial banking relationship manager should at least have been recommending CD's and other stable long-term interest-bearing instruments pending a full risk analysis to see if it's acceptable to move into mutual funds as a diversification strategy.
Disclaimer: I am not speaking in any official financial advisor capacity and this does not constitute financial advice.
Can charities invest in high-yield savings accounts? they’re not as in-depth or potentially high-earning as stock portfolios or other, admittedly more complicated methods, but 3.5+% APY is still far better than nothing—and pretty easy to get into! At least for individuals, idk about organizations like this.
I mean, a HRSA is the definition of the conservativest possible investment you can make. FDIC insured, security of principal, guaranteed interest rate insofar as the rate posted by the bank is what you'll get paid over the time period the interest rate is effective. I can't see any reason why using such an account would be forbidden to a charitable organization. (commercial banking often is the 'umbrella' banks will put nonprofits and charities under if they don't have a dedicated division for those two specific instances of non-individual banking)
I feel kind of silly saying this—like hopefully I’m misunderstanding something—but OTW, why don’t you use one of those while you get an investment policy in place? If that’s a whole year from now, that’s a decent amount of interest you could be earning….
Also I am not any sort of financial expert or advisor myself. I’m just a regular person with my own high-yield savings account and it’s pretty cool to see the interest accrue each month, and I’d love to see the same for the OTW.
Comment on 2024 Budget Update
smallhorizons Wed 16 Oct 2024 04:26AM UTC
Comment Actions
Yuechiang (OTW_Finance) (Official) Wed 16 Oct 2024 04:36AM UTC
Comment Actions
Quantum_Reality Wed 16 Oct 2024 03:04PM UTC
Last Edited Wed 16 Oct 2024 03:06PM UTC
Comment Actions
Corpium Fri 18 Oct 2024 02:46PM UTC
Comment Actions
Quantum_Reality Fri 18 Oct 2024 07:32PM UTC
Comment Actions
Corpium Fri 18 Oct 2024 09:02PM UTC
Comment Actions